Canada and China Broker Tariff Relief After Landmark Meeting

Fri Jan 16 2026 15:00:19 GMT+0200 (Eastern European Standard Time)

In a significant diplomatic thaw, Canadian Prime Minister Mark Carney meets with Xi Jinping in Beijing, announcing reduced tariffs and signaling a new chapter in Canada-China relations.

Following a high-stakes meeting in Beijing, Canadian Prime Minister Mark Carney and Chinese President Xi Jinping have revealed plans to reduce tariffs on key goods, marking a notable shift in the countries' long-strained relationship. Canada will significantly cut tariffs on canola oil, while China will benefit from a lower tax rate on electric vehicles. This development comes as both countries explore a more collaborative economic relationship amidst global trade tensions.

Canada and China Broker Tariff Relief After Landmark Meeting

11 minutes ago

Laura Bicker,Beijing,

Suranjana Tewari,Singapore,

Koh Ewe,Singaporeand

Jessica Murphy,Toronto

Reuters — Mark Carney's visit to China is the first by a Canadian leader in nearly a decade

Chinese leader Xi Jinping and Canadian PM Mark Carney have announced lower tariffs, signalling a reset in their countries' relationship after a key meeting in Beijing.

China is expected to lower levies on Canadian canola oil from 85% to 15% by 1 March. Meanwhile, Ottawa has agreed to tax Chinese electric vehicles at a most-favoured-nation rate of 6.1%, Carney informed reporters.

The deal represents a breakthrough after years of strained ties and tit-for-tat levies. Xi hailed the turnaround in their relationship, with Carney being the first Canadian leader to visit China in nearly a decade, a visit aimed at diversifying Canadian trade interests away from the US.

Additionally, the agreement could attract more Chinese investments in Canada. Carney hinted that Trump's tariffs have pushed key allies like Canada closer to China, and he described recent interactions as more predictable and characterized talks as realistic and respectful.

However, Carney was clear that there are disagreements, particularly concerning human rights, election interference, and maintaining clear boundaries in their relationship.

Observers suggest Carney's trip may set a precedent for other nations seeking to transform their ties with China amidst ongoing global trade challenges.

Meanwhile, Xi has advocated for China as a stable global partner, with recent visits by leaders from South Korea, Ireland, and upcoming visits from UK and German leaders, indicating a shift towards more pragmatic international relations.

In closing, Carney emphasized that Canada’s future positioning is crucial, suggesting a desire for a “new world order” amidst evolving global dynamics.